Weekly Podcast: Does Your Portfolio Need More Growth?
This week we will look at:
- How to create a solid stock portfolio: 5 important investment tips!
- How to put together the ultimate growth portfolio.
- An exciting announcement about 2 new portfolios added to the Wall St. Renegade lineup.
- 6 factors to consider before buying a stock
- My trade idea of the week
- My weekly run down on top sectors of the economy, my favorite currencies, commodities, and countries you should consider for your investment dollars.
Each and every week we tackle the world of finances so I can help you grow, protect, and share your wealth!
If you would like a review of your portfolio, whether you have IRAs, 401ks, Roths, or taxable investment accounts give me a call or email me for a FREE 30 minute review. Fill out the contact form or call us at 866-594-9919. For more information about our products and services check out wallstrenegade.com/products.
Does your portfolio need more growth?
No matter how old you are, your assets need to keep pace with inflation.
The need for growth investments
If you are in your 30s, 40s, or 50s you should have growth investments. Growth stocks are one of the best ways to multiply your assets. Growth stocks represent companies whose earnings are expected to grow at an above-average rate relative to the market. They entail more risk over time but offer greater rewards in the end.
Even if you are over 60 today, you are really investing for the long term. Life spans are getting longer with advances in health care. In reality, living past age 90 is likely for many of us. Your retirement could last 20, 30, 40 years, or longer.
Let’s say that you live 30 years after your retirement date. What if your retirement income and savings had little to no increase over the course of your retirement?
Think about this – back in 1984:
- A gallon of gas was $1.10
- A brand new Dodge Ram sold for $8,995
- A movie ticket was $2.50
- A nice pair of men’s leather shoes sold for $40
We’ve had over 30 years of low to modest inflation since 1984, but still think about how much these things cost today? What if we see high levels of inflation over the next two to three decades? What if today’s prices doubled, tripled, or worse? Imagine also having to pay healthcare costs after you retire. Those alone could cost you a fortune!
Financially, you don’t get a chance for a “do over” or an opportunity to “turn back the clock” when it comes to retirement. Time progresses and consumer prices soar year after year. Will your assets and income be left behind?
Your retirement savings and retirement income need to grow above and beyond the rising cost of living so you don’t risk running out of assets. This is why growth investing is so important for investors, baby boomers included!
Introducing the Ultimate Growth Portfolio
When it comes to stock categories, I look at capitalization and where the company is located. There are U.S. companies know as domestic stocks and foreign companies known as international stocks. As far as market capitalization goes, I break stocks into 4 categories (large cap stocks, mid cap stocks, small cap stocks, micro cap stocks).
So in building the Ultimate Growth Portfolio, I equally weight a portfolio (20% each) to the following 5 categories:
- Large Cap Stocks: A market capitalization value of more than $10 billion. Our Dueling Duo Portfolio deals with large cap stocks.
- Mid Cap Stocks: A market capitalization between $2 and $10 billion. Our Contrarian Strategies Portfolio deals with mid cap stocks.
- Small Cap Stocks: A market capitalization of between $500 million and $2 billion. Our Tomorrows Treasures Portfolio deals with small cap stocks.
- Micro Cap Stocks: Publicly traded companies that have a market capitalization between approximately $50 million and $500 million. Our Tiny Gems Portfolio deals with micro cap stocks.
- Foreign Stocks: Publicly traded companies that are based outside of the United States. Our Foreign Profits Portfolio focuses on international stocks.
The stock allocation looks like this:
Develop an investment strategy to meet your personal goals
In order to determine the most appropriate type of assets for your portfolio, you must look at your overall financial goals. If your goal is simply to maximize your portfolio as much as possible, you will want to build a stock portfolio that consists mostly of growth stocks. You will want to add in other asset classes like bonds, precious metals, commodities, real estate, and short-term investments to build a solid portfolio.
Diversify your portfolio
Regardless of whether you decide on growth or income, a portfolio should typically include no fewer than 10 stocks, but more realistically it should consist of at least 20 to 30 companies. Investing in multiple companies will spread out your risk as you invest in many types of companies in different industries and different classes of stock.
Implementing an Ultimate Growth Strategy
The ultimate growth portfolio is about investing in large cap, mid cap, small cap, micro cap, and foreign stocks. By combining these asset classes with our three step “proud to own” process:
- Avoid companies that violate your faith and values. Some of the types of companies we can avoid include those involved in the abortion industry, those producing explicit entertainment and pornography, those conducting embryonic stem cell and fetal tissue research, companies funding and lobbying for homosexuality, those involved in vices like alcohol, tobacco and gambling and companies that are abusing the environment.
- Seek out those companies that complement your faith and values. This involves finding companies: Helping the poor and defenseless; Protecting the sanctity of human life; Producing morally sound entertainment; Finding cures for life threatening diseases; and Improving the society we live in…
- Seek companies with strong profit potential. This involves finding companies in solid financial condition that have strong profit potential and/or provide strong cash flows via dividends. We use a five-point inspection to evaluate each investment we are considering. We analyze a company’s earnings potential, price momentum, risk, financial health, and its current valuation. Our goal is to find quality companies that stay true to your values AND are profitable! This is not an either /or scenario but rather a winning combination.
We help you develop a portfolio with explosive, upside potential.
At Wall St Renegade, we have developed a system to help you build your Ultimate Growth Portfolio. We select our top 5 ideas from each of our 5 portfolios:
- 5 Top Large Cap Stocks from our Dueling Duos Portfolio. These are top ranked large cap stocks that have made it through our rigorous moral and financial screens.
- 5 Top Mid Cap Stocks from our Contrarian Strategies Portfolio. This portfolio focuses on innovative, game changing companies that are changing the world around us.
- 5 Top Small Cap Stocks from our Tomorrow’s Treasure Portfolio. This portfolio focuses on high- quality, undiscovered smaller companies that may one day grow into larger, more recognized and profitable companies.
- 5 Top Micro Cap Stocks from our Tiny Gems Portfolio. This portfolio focuses on high-quality, microcap companies that are under-the-radar stocks with long-term gain potential of +50%, +100%, and much more.
- 5 Top Foreign Stocks from our Foreign Profits Portfolio. This portfolio focuses on non-U.S based companies designed to significantly enhance and protect your overall portfolio.
Gain access to this exciting Strategy at an introductory cost of just $49 for the next 12 months! Plus the first 49 people to sign up will get over $200 in bonuses!
Special Bonus Report: 25 Ultimate Growth Picks for the Next 12 Months & Beyond
12 Months access to Dueling Duos Portfolio: This portfolio has beat the markets 3 to 1 over the past 6 years!
12 Months access to Contrarian Strategies Portfolio: This portfolio currently has 8 stocks up over 40%! We are up over 400% on Tesla Motors and over 200% on Vipshop holdings.
12 Months access to Tomorrow’s Treasures Portfolio. This is our expolosive small cap portfolio that is up over 170% since 2009.
12 Months access to Tiny Gems Portfolio. Access to our brand new micro cap service with stocks expected to double in value quickly.
12 Months access to Foreign Profits Portfolio. Access to our brand new international stock service.
Over $300 worth of value for just $49!
Sign up today and get instant access on March 1, 2015. Please note the special bonuses are only available to the first 49 subsribers.
SUBSCRIBE NOW and save over $199!
DISCLAIMER: Faith-Based Investor’s Wall St. Renegade Monthly™ Newsletter is published by Faith-Based Investor, LLC, 1121 Park West Blvd. Suite B, #156 Mt. Pleasant SC 29466. Publisher/Founder: Jay Peroni, CFP®.
Current Subscription Rate: $199 per year, online subscriptions are available at www.wallstrenegade.com. ©2009-2015 by Faith-Based Investor, LLC. All Rights Reserved. Photocopying, reproduction, quotation, or redistribution of any kind is strictly prohibited without written permission from the publisher.
Wall St. Renegade Monthly™ Newsletter is strictly an informational publication and is not intended to provide individual, customized investment or trading advice to its subscribers. Although many of our analytical approaches are unique, they are based on publicly available data; and although analysts may visit specific sites, companies or countries to gain a more objective on-the ground perspective regarding specific investment opportunities, they do not seek or accept data that’s not available to the public. The money you allocate to speculative trading should be strictly the money you can afford to risk. While every effort is made to simulate the actual experience of subscribers, all performance figures must be considered hypothetical.
Christian Investing: 5 Steps to be More Faithful
As Christians, we long to hear the words “well done, good and faithful servant!” (Matthew 25:23). One of the ways we can be faithful with our money is the manner in which we invest. Christian financial stewardship is about how we earn income, how we tithe, how we save and invest, and many other facets of our financial lives.
Are you concerned about where your money is being invested? Wouldn’t you like to get a good return and feel good about what you are supporting?
Let me ask you an important question: How do you feel about the moral direction of our country?
What I mean is…
Do any of the trends on the list below make your blood boil or your heartache?
- The rising number of abortion clinics, facilities and activist groups…
- The shady deceptive practices being used by the pornography industry…
- The number of families being torn apart by addictions ranging from alcohol to drugs to gambling… or the number of deaths caused by the tobacco industry…
- The promotion of homosexuality in the media, in entertainment and in government…
Do you ever wonder who supports these types of damaging organizations and industries…who exactly are the faces and companies behind such obvious threats to the moral fabric of our country?
Are you, like me, outraged by the damaging effects these types of groups and industries have on our communities and our families.
If so, then you might want to sit down…
Because, the truth is, your investment dollars may actually be strengthening these industries.
In short, your money may be helping to create and to sustain the very industries you despise.
Now, let me be blunt…
If what I’ve just said doesn’t concern you… if you consider profits at any cost ok… if the
ends justify the means… then I’m wasting your time and you can just STOP reading this article immediately.
However, if you are concerned about where your investment dollars end up—and what they support, then you should know…there is an alternative.
An alternative that can keep your hard-earned dollars away from these immoral industries (or any other industry that doesn’t line-up with your values) and instead place your dollars with companies and industries you will be proud to own.
It’s an alternative I call ―”Faith-Based investing”.
Best of all you won’t have to sacrifice investment gains.
In fact, you could beat the Wall Street ―pros by placing your principles and values first.
Let me explain how this got started…
A Life Changing Question
Has anyone ever asked you a question that you couldn’t answer? Not a question of knowledge but one of those really deep meaningful, complex questions of life.
You know the type…like the first time you wrestled with…
Is there life after death?
Do you believe in God?
Is Jesus the ONLY way to heaven?
Imagine yourself for a moment, listening to a soul-searching question… so convicting, paralyzing and deep it penetrates the depths of your soul.
A question that shakes the moral foundation your life is built upon.
A question that once answered will require you to make changes you’d never considered before.
My name is Jay Peroni and I was faced with just such a question.
A question that after nearly ten years of professional experience, a masters degree in financial planning and rigorous training to become a Certified Financial Planning (CFP®) professional left me speechless…
It was a question that overloaded my professional circuitry and left me feeling both cowardly and incompetent. Sixteen years of school and years of professional experience had simply not prepared me for the question.
So what was the question that ultimately caused me to walk away from my cushy 6-figure financial career and start FaithBasedInvestor.com?
It was this…
“Jay, can I expect God to bless my investments if I am investing in companies that violate His principles?”
The question came from a Christian woman that also happened to be one of my clients.
Little did I know at the time her question would send me on a painstaking and revealing two-year journey.
However, today I can answer the question with confidence, clarity and conviction.
Better yet, thanks to thousands of hours of research, I can now show you how to build a solid portfolio that enriches your life and your wallet. I can help you become a better, “faith-based” investor!
Do your investments line up with your faith and values? Are there social or moral issues important to you? The “proud to own” process is about aligning your portfolio with your values…
Faith-Based Investing Made Simple!
- Set up a VIP membership and brokerage account. We suggest using folioinvesting.com or www.sharebuilder.com to save on fees.
- Answer our asset allocation questionnaire or select one of our 7 portfolio strategies. Our 2015 Faith-Based Asset Allocation Models are online, simply go to
- Buy the suggested investments. Mirror our asset allocation models or mirror one of our 7 portfolio strategies.
- Watch for trade alerts. Whenever we buy or sell a position we will send out a trade alert and let you know what to do next…
- Make the suggested changes. It’s really that simple!
Our Faith-Based Approach seeks to help you:
- Discover what values are important
- Align your investments with your values
- Design a portfolio that embraces your faith
- Implement a strategy to grow your assets
- Manage your portfolio
Interest Rates are Still at Rock Bottom Levels
Many retirees find that their income streams are insufficient these days. As a result, many look for additional ways to earn more income. With rock bottom interest rates, investors are seeking out higher yielding investments. The federal funds rate is still near zero and the classic conservative retirement investments like money market funds and CDs are failing to keep up with inflation.
So where can you turn to get more income, especially if you are close to or in retirement?
- Real estate investment trusts (REITs): This investment allows you to enter the commercial real estate sector without the hassles of property. They give you a fractional ownership share of a major-league real estate portfolio, with potential for dividend payments and excellent returns. A couple of examples of stocks worth considering in this category include Realty Income (NYSE: O) and Extra Space Storage (NYSE: EXR).
- Dividend stocks: These types of companies stood out during the recession, as investors turned to them for cash flow. Commonly, they are issued by established corporations in essential industries. In this category, I look for companies paying at least a 2% dividend. I like Taiwan Semiconductor (NYSE: TSM) and Dr. Pepper Snapple (NYSE: DPS) in this category.
- Utilities stocks: These often provide a hedge as they have the potential for nice dividends in good and bad market climates. Some of my favorites include Brookfied Infrasture (NYSE: BIP) and American Water Works (NYSE: AWK).
- Master Limited Partnerships (MLPs): Almost all MLPs are pipeline businesses making money from the processing or transport of oil, natural gas or coal. Some of my favorites in this category include Magellan Midstream Partners (NYSE: MMP) and Tallgrass Energy Partners (NYSE: TEP).
- Currencies: When the dollar is weak, funds investing in foreign currencies get a boost as most funds out there are dollar-denominated. With the dollar strong now, this is a place to consider as the dollar starts declining again.
You can invest in many of these asset classes not only via stocks, managed funds, and exchange-traded funds (ETFs). ETFs are nice, as they don’t cost an arm and a leg to enter. They are tax-efficient, and as they trade on exchanges during the market day and they also offer great liquidity and flexibility.
One of my favorite income investments are Master Limited Partnerships (MLPs). They’ve outperformed stocks for over a decade while offering attractive yields and typically less fluctuations than stocks. These investments often generate consistent, sizable dividends. Because they transport commodities like oil and natural gas rather than explore for them, they are theoretically less affected by ongoing volatility in commodity prices.
An MLP combines the tax structure of a limited partnership with the liquidity of a publicly traded security. An MLP pays out nearly all of its free cash flow to investors in the form of quarterly distributions. Most of these MLPs pay annual yields in excess of 2-3% making them an attractive investment option for many retirees. MLPs also have big depreciation shields from capital expenditures and thus 80% of their distributions are characterized as tax-deferred return on capital.
There are some drawbacks to MLPs. MLPs are exempt from corporate taxes, and the taxed portion of an MLP distribution is taxed as regular income. The tax-deferred part of the payout reduces your cost basis in MLP shares and it becomes taxable when the MLP shares are sold. Appreciation in MLP holdings are subject to corporate tax, and MLP investors will get K-1 forms each year instead of annual 1099s. Consequently, MLPs can be problematic for investors with tax-deferred accounts. Expect intensive paperwork at tax time if you own MLP shares.
MLPs can be a perfect solution for income-focused investors who want to diversify their holdings. If you don’t want to purchase individual MLP holdings, you can also select exchange trade funds (ETFs) or mutual funds that invest in these types of investments. If you are looking for more income and don’t want to add a lot of risk, MLPs may provide the perfect income solution.
Want more income ideas?
Check out our Global Income Portfolio Service. We help you find high yield opportunities in a low interest environment is quite the challenge. Our low-risk investing approach focuses on safe, high dividend stocks that can weather any kind of storm that might come our way.
Buy Low, Sell High
With a strong dollar, commodities have had a rough few years. Now might be a great time to start adding precious metals, agriculture, energy, and other commodities to your portfolio…
Is now the time to start looking into commodities?
Commodity investing has really changed over the last decade or. Investing in soybeans used to just be a “sitcom wisecrack” while kruggerands were being sold in low-budget TV commercials. Most people used to view commodities as exotic, “out of the box” opportunities for really experienced investors. These were not simple investments designed for the average person. In fact, most individual investors could not enter the commodities market unless they met strict financial/net worth criteria.
However, with the recent popularity of gold, silver and oil investment opportunities, many investors are now taking ahard look at commodities, and finding ways to invest in them. This can now be accomlished through a variety of vehicles such as exchange-traded funds (ETFs), closed-end funds, publicly traded and non-publicly traded entities (all regulated and registered), and through a variety of mutual funds.
Commodities help you diversify outside the stock market
“Hard assets” like timber and coal, crude oil, commercial real estate, along with metals like gold, silver, and copper are not correlated to the stock market’s returns. These non-correlated assets add diversity to investors’ portfolios and can actually help improve portfolio returns while lowering overall risk.
Ibbotson Associates, a world-renowned financial research firm, conducted a long-term study showing that even a modest 10% allocation to these “real” assets, can increase the overall expected return of a low-risk portfolio from 8.1% to 8.6%. Ibbotson has also shared over 40 years of commodity market data, which revealed that over long periods of time, commodities often outperfom stocks.
Where the big money invests
Some of the biggest endowments on the planet allocate healthy amounts of its investment portfolios toward commodities. One of the nations largest endowments (Yale Endowment) often allocates 25% or more of its funds to real estate, timber, oil and gas and other “real assets”. In recent years, many other endowed institutions have followed suit and also diversified into commodities.
While we’ve certainly seen a major collapse in commodity prices over the past few years, many analysts do not believe these markets are doomed. The world demand for precious metals and natural resources should continue to go higher as the population continues to grow.
Developing a Natural Resources Strategy
CLICK HERE FOR MORE INFO
Commodity investing is designed for investors who can withstand fluctuations (ups and downs of the markets) and willing to hold these investments for at least three to five years. It is not for those who are risk averse or looking to make quick gains. It is a long-term approach with a focus on building wealth along with inflation-protected growth. Here are the major components of a natural resources strategy:
We believe long-term that the dollar will continue to lose value and gold, silver, along with mining companies should benefit from this trend.
As the global population continues to grow we believe land and agriculture will continue to see shortages. This will lead to higher food and land prices.
We believe the emerging markets will continue to expand and drive up commodity prices with their demand. As the dollar continues its long-term decline, this should also benefit steel, cooper, and other metals.
We believe that world energy demand should continue to be strong over the next 3-5 years and having exposure to companies involved in exploration, servicing, and drilling should see healthy gains. We also want exposure to natural gas and oil.
To provide a bit more stability, we look for companies dominating their industries, paying healthy dividends, and those that have global exposure. We like companies in stable industries with strong demand.
As you can see this is a diversified portfolio strategy. It is for investors looking to diversify away from the stock market and have a solid plan of attack for when inflation comes roaring back.
CLICK HERE to learn more about natural resources investing.